Life is uncertain and anyone can get sick or injured at any time. With rising medical expenses in India, health insurance has become more of a necessity than a choice. The COVID-19 pandemic has also encouraged a lot of people to buy medical insurance but buying the right coverage amount is still a matter of concern. Let’s find out the ideal health insurance coverage amount for different individuals.
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The right health insurance coverage amount varies from one person to another. However, there are two rules that you must follow to choose the right coverage amount for your health insurance policy. They are:
If you want to buy health insurance for yourself, then you must opt for a coverage amount equivalent to at least half of your annual income. For instance, if your annual income is Rs 8 lakh, then you must opt for a health insurance cover of at least Rs 4 lakh.
However, healthcare expenses have increased tremendously in the last few years. In this situation, opting for a lower health cover, even if it is equivalent to 50% of your salary, may not be enough. Hence, insurance experts advise people to opt for a minimum health insurance cover of Rs 5 lakh to cover their medical expenses comfortably.
Moreover, if you buy insurance in the early 20s, the chances of raising a claim are lower in early adulthood. As a result, you will be able to increase your sum insured at no extra cost with the help of a cumulative bonus on every claim-free year.
Just like yourself, you need to cover your entire family under a medical insurance policy. This is because a medical emergency can occur with any member of your family at any time and a single hospitalization can severely reduce your family’s savings. To avoid such a situation, insurance experts advise a family of four to opt for a minimum health insurance cover of Rs 10 lakh.
The good thing about buying medical insurance for your family is that you can opt for a family floater plan and reduce your premiums substantially. Under family floater plans, a single sum insured is shared by all insured family members on a floater basis. Since you do not have to buy individual health policies for each family member, it lowers your overall premium costs. Besides, the chances of all family members raising a claim in the same year are very low.
Suppose the premium for a family health policy of Rs 10 lakh is Rs 20,000 and the cost of an individual health policy of Rs 5 lakh is Rs 10,000. So, if you buy an individual health policy for four family members, you will have to pay a total premium of Rs 40,000. However, you can get the same coverage on a floater basis under a family health insurance plan for Rs 20,000.
Senior citizens and parents are most vulnerable to illness and diseases. They require health insurance the most as they are more likely to develop a medical condition or get hospitalized. Given the medical inflation today, bypass surgery can easily cost up to Rs 2 lakh in a good hospital while a small surgical procedure can easily cost you up to Rs 1 lakh.
Hence, senior citizens and parents require a health policy with a high sum insured amount. You can opt for health insurance for parents or senior citizen health insurance with a high sum insured to ensure adequate coverage.
But with an increase in the sum insured, the premium will also increase. Insurance companies generally charge a higher premium to senior citizens as they are more likely to raise a claim. Thus, make sure to check the premium of the health insurance policy before buying it for your parents or senior citizens.
Here are some things to keep in mind while choosing the right health insurance coverage amount:
Buying health insurance with an adequate sum insured is a basic necessity for everyone today. It is important to opt for a medical insurance coverage amount that sufficiently covers your medical expenses today as well as in the years to come. Do remember to keep the above-mentioned rules and factors in mind while deciding the right coverage amount for your health policy.
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